SEC Announces ‘Project Crypto’ To Move US Capital Markets to the Blockchain

SEC Chair Paul Atkins announced “Project Crypto”, a sweeping initiative to modernize securities regulations so US capital markets can operate on the blockchain. 

This is the most aggressive regulatory pivot the SEC has ever taken toward pro-crypto innovation. It follows President Trump’s GENIUS Act and the President’s Working Group (PWG) report. 

What is the SEC’s Project Crypto?

“Project Crypto” is a Commission-wide overhaul of securities regulations to:

• Enable blockchain-based (on-chain) markets.
• Clarify legal rules for crypto asset issuance, trading, and custody.
• Stop driving innovation offshore.
• Replace outdated 20th-century rules with blockchain-native policies.

According to the statement, Atkins is mandating interpretive guidance, exemptions, and safe harbors in the short term. This will allow web3 innovation to continue while new rules are drafted.

Also, the SEC plans to allow tokenized securities, such as stocks, bonds, and partnership interests, to be issued and traded on public blockchains.

This will enable companies to raise capital directly through blockchain-based offerings. 

Most importantly, this includes initial coin offerings (ICOs), airdrops, and network rewards—without needing offshore entities or complex workarounds.

Custody rules will also be updated to support blockchain-based settlement and safekeeping, removing barriers to using smart contracts and decentralized infrastructure.

The Commission will propose new rules allowing tokenization of traditional assets. 

To sum it up, the SEC is replacing it with clear guidance and written rules. This means no more “scarlet letter” for projects that issue crypto as securities. 

Overall, developers can now engage without fear of lawsuits for merely building. Clear tests will help determine whether a crypto asset is a security or not, moving away from vague reliance on the Howey Test.

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